India: How a Microfinance Firm Is Using Big Data and Analytics to Reach the Unba...

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Sep 2014
India, September, 24 2014 - So, what is unique about this deal other than humungous amount of money involved? It is Big Data and Analytics. Radhakrishna V S, Janalakshmi’s MD and CEO asserts that JFS is the first microfinance firm to use Big Data to make sense of urban banking and get insights into the behavior of unbanked masses.

The government set the wheel in motion when 1.5 crore bank accounts were opened across the country in August following what Prime Minister Narendra Modi promised in his Independence Day speech. Financial inclusion for low-income groups in both rural and urban India is what the promise carried, with the aim of opening 7.5 crore bank accounts by January next year, under the mega scheme ‘Pradhan Mantri Jan Dhan Yojna. The scheme will enable people to open zero-balance accounts with any private or public bank.

As the government is inclined to take this herculean task of providing ‘Dhan’ for the financially-neglected masses, microfinance firms have also set on the journey to infuse the banking culture among low-income groups in urban India.

For example, in July this year Janalakshmi Financial Services (JFS) entered into a six-year agreement with IBM in its endeavor to financially include India’s urban unbanked population. It is leveraging mobility, Big Data and Analytics to provide financial services to individuals and small enterprises across India. According to popular media reports the deal is worth Rs 400 crore. Though neither IBM nor Janalakshmi is open about the money involved but surely the agreement means a lot for both and certainly what it holds for the future of microfinance industry in India.

So, what is unique about this deal other than humungous amount of money involved? It is Big Data and Analytics. Radhakrishna V S, Janalakshmi’s MD and CEO asserts that JFS is the first microfinance firm to use Big Data to make sense of urban banking and get insights into the behavior of unbanked masses.

In fact, JFS seems to be a champion of technology when it comes to implementing it in its smooth functioning. “We are the first MFI to have core-banking solution; we run our entire technology workflow on Salesforce.com. Our front-end, which involves our sales representatives, carry a netbook along with a biometric reader. We have got our entire database on biometrics", says Radhakrishnan.

To this the company’s Senior VP Santanu Mukherjee adds, “As an organization we have been a firm believer in technology. One of the core tenants for us is to have an enabling technology which can be more nimble in terms of helping us to provide solutions to our customers".



Source : Information Week
 

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